SENATE 


No.  25. 


REPORT 

RESPECTING  THE 


FRANKLIN  BANK.- 


©ommontocaUlj  of 


House  of  Representatives,  Jan.  10,  1838. 


Ordered^  that  a  Joint  Special  Committee  be  appointed 
to  examine  into  the  doings  of  the  Franklin  Bank,  in  the 
city  of  Boston,  and  hear  the  bank  thereon,  agreeably  to 
the  provisions  of  the  thirty-sixth  chapter  of  the  Revised 
Statutes,  and  to  report  the  result  of  their  investigations 
to  the  present  Legislature  :  and 

Messrs.  Robbins,  of  Milton^ 

Sturgis,  of  Boston^ 

Lincoln,  of  Worcester, 


were  appointed. 


Sent  up  for  concurrence. 


L.  S.  CUSHING,  Clerk. 

In  Senate,  Jan.  11,  1838. 

Concurred  :  and  Messrs.  Child  and  Goodrich  are  joined. 

CHARLES  CALHOUN,  Clerk. 


(SommautoeaUlj  of 


In  Senate,  Jan.  31,  1838. 

The  Joint  Special  Committee  appointed  to  examine  into 
the  doings  of  the  Franklin  Bank,  in  the  city  of  Boston, 
and  hear  the  bank  thereon,  agreeably  to  the  provisions 
of  the  thirty-sixth  chapter  of  the  Revised  Statu'tes,  and 
report  the  result  of  their  investigation  to  the  present 
Legislature,  submit  the  following 


REPORT: 


The  Committee  met  the  president  and  directors  of  the 
bank,  at  their  banking-house,  for  the  first  time,  on  Friday 
the  twelfth  day  of  the  present  month,  and  continued  their 
investigations  during  six  successive  meetings,  at  each  of 
which  the  president  and  a  majority  of  the  directors  were 
present.  Previous  to  the  last  meeting  of  the  committee 
which  was  on  Saturday  the  20th  instant,  they  caused  the 
corporation  to  be  duly  notified  to  appear  before  them,  to 
show  cause  why  their  charter  should  not  be  declared  for¬ 
feited. 

The  present  condition  of  the  bank  will  appear  by  the 
following  statement  furnished  to  the  committee  at  their 
first  meeting. 


State  of  the  Franklin  Bank,  January  12,  1838. 


FRANKLIN  BANK. 


CJ 


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i 


1838. 


SENATE— No.  25. 


5 


From  this  statement,  it  appears  that  there  is  a  very 
great  deficiency  in  the  assets  of  the  bank  to  meet  its  lia¬ 
bilities,  and  this  deficiency  will  the  more  strikingly  appear 
by  a  particular  examination.  The  real  estate  which  stands 
upon  the  books  of  the  bank  at  ^'23,123  86,  is  now  under  at¬ 
tachment  to  the  amount  of  ^7500,  and  on  the  tenth  day  of 
July  last  was  assigned,  subject  to  the  attachment,  to  the 
United  States  to  secure  the  sum  of  ^  1 2,51 1  25.  The  next 
item  of  j5fl834  04  in  a  debt  against  the  Westbrook  bank  in 
the  state  of  Maine,  is  claimed  to  have  been  settled.  And  the 
committee  are  induced  to  believe  that  such  is  the  fact. 
The  Franklin  bank  stock  to  the  aniountof  ^82,080,  which 
is  held  bv  this  bank  on  its  own  account,  cannot  in  the 
least  add  to  its  resources  ;  for  it  appeared  to  the  committee 
most  satisfactorily,  that  for  many  months  the  stock  has  been 
worthless. 

A  similar  remark  rnav  be  made  in  reference  to  the 

•/ 

5,600  of  stock  in  the  Lafayette  bank.  Although  the 
committee  are  not  informed  of  the  exact  condition  of  this 
bank,  yet  such  has  been  its  intimate  connexion  with  the 
Franklin  bank,  that  our  examination  has  made  us  suf¬ 
ficiently  acquainted  with  its  situation  to  assure  us  of  the 
entire  worthlessness  of  its  stock.  The  debt  of  1 0,600 
against  the  Lafayette  bank,  is  balanced  by  two  bank 
books,  sold  by  the  Franklin  bank  to  the  Lafayette  bank, 
which  were  negotiated  by  the  latter,  and  were  not  paid 
by  the  Franklin  bank  when  they  became  due,  and  which 
will  hereafter  be  returned.  The  item  of  ^169,246  08, 
of  notes  discounted,  was  found,  upon  particular  examina¬ 
tion,  not  to  add  very  materially  to  the  resources  of  the 
bank.  ITe  whole  of  these  notes  have  for  some  time 
been  overdue.  More  than  one  half  of  the  whole  amount, 
or  about  ;^90,000,  are  payable  in  the  liabilities  of  the 
2 


6 


FRANKLIN  BANK. 


Jan 


Franklin  bank,  the  original  notes  having  been  given  up 
lor  notes  payable  in  that  manner ;  and,  although  a  por¬ 
tion  of  notes,  payable  in  Franklin  hank  securities,  are  not 
now  due,  the  debts  for  which  they  were  given  had  been 
a  long  time  over  due,  before  they  were  exchanged.  Of 
the  remainder  of  the  notes  which  have  not  been  ex¬ 
changed,  but  a  small  amount  can  ever  be  collected.  The 
checks  of  different  individuals,  to  the  amount  of  ;§f58,- 
460  94,  are,  as  near  as  the  committee  could  ascertain, 
of  more  doul)trul  value  than  the  notes. 

The  remaining  item  among  the  assets  of  the  bank 
which  we  shall  notice,  is  the  sum  of  120,8 15  79,  claimed 
as  a  balance  against  Benjamin  F.  Hathorne,  the  former 
cashier  of  the  bank.  Hathorne  denies  that  this  sum  is 
due.  The  particular  circumstances  of  this  claim  will  be 
explained  hereafter.  It  is  sufficient  here  to  observe,  that, 
wh{‘ther  the  claim  be  due  or  not,  its  payment  cannot  be 
expected,  as  Hathorne  is  represented  as  destitute  of  prop¬ 
er  tv. 

From  these  statements  it  is  apparent,  that  not  only  has 
the  whole  capital  of  the  bank  been  lost,  but  that  a  great 
proportion  of  its  bills  and  liabilities  now  in  the  hands  of 
the  public,  amounting  in  the  aggregate  to  more  than 
^650,000,  will  never  be  paid.  The  committee  were  on 
this  account  induced  to  institute  a  most  rigid  examination 
into  the  causes  and  course  of  management  which  had 
overwhelmed  the  institution  in  such  complete  ruin.  The 
result  of  that  examination  we  now  proceed  to  spread 
before  the  Legislature. 

The  Franklin  bank  was  incorporated  in  1828.  Its 
capital  was  originally  100,000,  and,  at  the  January  ses¬ 
sion  of  the  Legislature  1832,  was  increased  to^l50,000. 
The  w'hole  amount  of  its  capital  was  paid  in,  and  it  con- 


1838. 


SENATE— No.  25. 


7 


tinued  in  a  highly  prosperous  condition  till  the  change  in 
its  direction,  which  took  place  in  October,  1834.  Mr. 
Jeremy  Drake,  who  was  its  cashier  from  October,  1831, 
till  the  autumn  of  1834,  testified  to  the  committee,  that 
its  concerns  were  in  a  flourishing  condition  at  the  time 
he  left  the  bank. 

During  the  summer  of  1834,  a  project  was  set  on  foot 
by  Thomas  Richardson,  Josiah  Dunham  and  Benjamin 
F.  Hathorne,  with  the  knowledge  and  advice  of  Ebenezer 
Stevens  and  Ebenezer  Hayward,  and  perhaps  others  to 
change  the  direction  of  the  bank,  and  place  its  manage¬ 
ment  in  other  hands.  To  accomplish  this,  it  became  nec¬ 
essary  to  purchase  a  sufficient  amount  of  stock  to  secure 
a  majority  of  votes  at  the  election  of  directors.  Richard¬ 
son  and  Hathorne  were  the  active  parties  in  the  purchase 
of  the  stock,  and  the  result  of  their  efforts  was,  that  they 
became  the  owners  of  the  stock  of  the  bank  to  the 
amount  of  about  ^75,000,  at  a  cost  to  themselves,  of 
eight  per  cent,  above  par. 

By  means  of  this  stock  thus  purchased,  a  new  board  of 
diref'tors  was  chosen  in  October,  1834,  among  whom  were 
Richard  son,  Dunham,  Stevens  and  Hayward.  Richard¬ 
son  was  made  president  and  Hathorne  cashier.  Of  the 
stock  wiiich  had  been  purchased  under  the  foregoing  ar¬ 
rangement,  ^25,000  were  taken  by  Richardson,  and  the 
remainder  was  left  upon  the  hands  of  Hathorne,  in  whose 
name  it  liad  been  originally  purchased.  Although  it  had 
been  understood  that  Dunham,  Stevens  and  Hayward 
were  to  be  interested  wdth  Richardson  and  Hathorne  in 
the  stock  to  be  purchased,  this  arrangement  seems  never 
to  have  been  carried  into  effect.  Hathorne,  a  young  man, 
destitute  of  property,  and  the  cashier  of  the  bank,  w  as  thus 
left  with  ^50,000  of  its  stock  on  hand  and  to  provide  for 


8 


FRANKLIN  BANK. 


Jan. 


the  payment  of  this  large  debt  which  had  been  incurred 
by  the  purchaser.  That  this  stock  was  held  by  Ha- 
thorne,  with  the  knowledge  and  consent  of  the  directors,  is 
proved  by  the  fact  that  he  was  aided  by  the  funds  and 
credit  of  the  directors  as  w  ell  as  the  funds  of  the  bank  in 
his  numerous  operations  on  account  of  it,  in  which  he  was 
engaged  for  a  period  of  about  three  years.  During  these 
operations,  Hathorne  sustained  himself  by  a  resort  to 
loans  on  short  periods  of  time  and  at  exorbitant  rates  of  in¬ 
terest.  And  w'hen  loans  could  not  be  obtained  in  season 
to  meet  his  numerous  payments,  the  cash  drawer  of. the 
bank  supplied  the  deficiency ;  and  when  by  these  appropria¬ 
tions  the  resources  of  the  bank  were  so  far  diminished  as 
to  render  it  unable  to  meet  the  numerous  applications  of 
its  customers  for  discounts,  most  of  w’hom  w^ere  the  direc¬ 
tors,  new  loans  were  negotiated  to  supply  the  deficiency 
which  had  thus  been  produced  in  the  funds  of  the  bank. 
Although  this  stock  stood  upon  the  books  in  the  name,  of 
Hathorne, — Dunham,  Stevens  and  Hayward  seem  to 
have  considered  themselves  under  obligation  to  sustain 
him  in  the  numerous  payments  w  hich  w^ere  from  time  to 
time  made  on  account  of  it.  This  is  shown  not  only  by 
the  fact  that  Dunham  and  Stevens  were  the  endorsers  of 
his  notes,  and  that  they  consented  to  his  using  in  their 
operations  the  funds  of  the  bank,  but  also  by  the  fact  that 
an  agreement  was  entered  into  between  Dunham,  Ste¬ 
vens  and  Hayw^ard,  to  share  among  themselves  in  certain 
proportions,  the  extra  interest  which  had  been  paid  by 
Hathorne  upon  his  stock  notes.  These  transactions  seem 
to  have  been  so  far  connected  with  the  operations  of  the 
bank,  that  no  account  of  them  w^as  kept  by  Hathorne, 
separate  from  the  concerns  of  the  bank,  l)ut  that  his  stock 
transactions  W'ere  so  intimately  blended  with  all  the  bus- 


1838. 


vSENATE— No.  25. 


9 


iness  of  the  bank,  that  loans  were  as  frequently  negotia¬ 
ted  by  Hathorne,  to  supply  the  wants  of  the  bank,  as  for 
the  payments  of  his  own  notes. 

This  state  of  things  continued  until  Hathorne  ceased  to 
be  cashier  of  the  bank,  in  1837,  and  at  a  loss  to  the 
bank,  as  it  eventually  turned  out,  of  not  far  from  ^20,000, 
as  claimed  by  Hathorne,  in  extra  interest,  paid  in  the  va¬ 
rious  negociations,  on  account  of  this  stock.  In  the 
month  of  August,  1836,  Mr.  Richardson,  who  is  not 
proved  to  have  been  as  conversant  with  Hathorne’s  trans¬ 
actions,  in  Franklin  bank  stock,  as  other  directors,  left 
the  bank,  having  first  sold  to  Dunham,  who  succeeded 
him  in  the  office  of  president,  his  stock  to  the  amount  of 
;§27,000,  at  an  advance  of  three  per  cent,  above  par. 
Richardson’s  stock  was  paid  for  out  of  the  funds  of  the 
bank.  Mr.  Richardson  testified,  that,  for  more  than  a 
year  before  he  left  the  office  of  president,  his  confidence 
in  the  integrity  of  Hathorne  was  impaired,  and  that  he 
called  for  an  investigation  into  his  accounts  and  doings. 
Several  investigations  were  had,  and  resulted  in  discov¬ 
ering  no  deficiency  in  the  funds  of  the  bank. 

In  the  month  of  November  or  December,  as  testified 
by  the  present  directors,  their  confidence  began  to  be  im¬ 
paired  in  the  integrity  of  Hathorne,  from  the  fact,  that 
they  ascertained,  that  he  had  applied  $23,000  of  the 
money  of  the  bank,  to  a  speculation  in  beef  and  pork,  in 
which  Hathorne  w  as  to  be  jointly  interested  with  another 
individual.  But  it  does  not  seem  that  this  produced  anv 
great  alarm  in  the  minds  of  the  directors,  for  they  admit 
that,  after  this  discovery  was  made,  they  suffered  Ha¬ 
thorne  to  remain  as  cashier  for  at  least  the  period  of  two 
months.  It  w'as  also  admitted  by  Stevens,  that,  previous 
to  Hathorne’s  engaging  in  this  speculation,  the  project  was 
submitted  to  him  by  Hathorne,  and  Stevens  does  not  ap- 


10 


FRANKLIN  BANK. 


Jan 


pear  to  have  discountenanced  it.  In  the  month  of  Feb¬ 
ruary,  1837,  Dunham,  as  president  of  the  bank,  agreed 
to  take  of  Hathorne  his  stock,  at  its  cost,  including  the 
^20,000  which  had  been  paid  in  extra  interest.  This 
stock,  with  that  purchased  of  Richardson  and  a  few  addi¬ 
tional  shares  which  had  been  purchased  by  Hathorne 
subsequent  to  the  first  operation,  which  stood  in  his 
name,  make  up  the  $82,080  of  Franklin  Bank  stock 
which  now  appears  among  the  assets  of  the  bank. 

The  stock,  taken  of  Hathorne,  was  credited  to  him  at 
its  par  value  upon  the  books  of  the  bank,  and  even  that 
amount  did  not  reduce  his  balance  below  $120,000.  It 
is  claimed  by  Hathorne,  that  the  $20,000  wdiich  was  paid 
by  him  in  extra  interest  should  also  be  credited  to  him. 

The  Franklin  bank  stock  was  not  the  only  stock  in 
W’hich  Hathorne  was  concerned,  w  hile  he  was  cashier  of 
the  bank.  Stocks  in  the  South  Boston  India  Rubber 
Company,  the  Boxbury  India  Rubber  Company,  the 
Chemical  Com.pany,  the  Lafayette  bank  and  the  West¬ 
brook  bank,  all  received  a  due  share  of  his  attention. 
The  committee  are  unwilling  to  extend  this  report  by  a  de¬ 
tailed  account  of  the  various  transactions  in  these  stocks. 
We  will  how'ever  remark,  that,  in  most  of  these  trans¬ 
actions,  he  w’as  connected  wdth  some  one  or  more  of  the 
directors  of  the  bank.  In  the  Roxburv  India  Rubber 
stock,  Richardson  being  then  president  of  the  bank  was 
jointly  concerned  w  ith  him.  And  the  result  of  that  trans¬ 
action,  so  far  as  regards  the  bank,  is,  that  Hathorne^s 
note  is  now  among  the  assets  of  this  bank  for  $10,000, 
w  ith  Chemical  stock  pledged  as  collateral.  In  his  deal¬ 
ings  in  South  Boston  India  Rubber  stock  he  was  con- 
nected  with  Thomas  Richardson,  Josiah  Dunham,  Eben- 
ezer  Stevens  and  Hugh  Montgomery,  all  directors  of  this 
bank,  and  owmers  of  stock  in  the  South  Boston  India 


]838. 


SENATE— No.  25. 


11 


Robber  Company.  As  a  subscriber  to  the  stock  of  the 
Lafayette  Bank,  his  name  appears  with  ,  those  of  Josiah 
Dunham  and  Ebenezer  Stevens  and  Thomas  Richardson, 
to  the  following  amounts  : 


Josiah  Dunham, 
Ebenezer  Stevens, 
Thomas  Richardson, 
Benj  amin  F.  Hathorne, 


,^30,000 

12,000 

15,000 

5,000 


and  these  subscriptions  to  the  stock  of  the  Lafayette 
bank  were  made  at  the  very  period  wlien  Hathorne  was 
holding  stock  in  the  Franklin  bank,  witli  the  consent  and 
aid  of  Dunham  and  Stevens,  to  the  amount  of  more  than 
,^50,000,  without  being  able  to  pay  for  it,  except  from 
the  funds  of  the  Franklin  bank. 

In  his  transaction  in  the  stock  of  the  Westbrook  bank, 
Hathorne,  as  testified  by  himself  and  not  contradicted  by 
Dunham,  was  Jointly  concerned  with  Dunham,  who  w^as 
then  president  of  the  Franklin  bank.  In  explanation  of 
Hathorne’s  transactions  in  the  stock  of  the  Westbrook 
bank,  and  of  the  item  shown  among  the  assets  of  the 
bank  as  a  debt  due  from  the  Westbrook  bank,  a  transac¬ 
tion  was  disclosed  by  Hathorne,  and  admitted  to  be  cor¬ 
rect  by  some  of  the  directors,  which  tlie  committee,  un¬ 
der  their  instructions  to  examine  into  the  doings  of  the 
bank  and  report  their  results,  feel  bound  to  spread  before 
the  Legislature. 


After  the  Franklin  bank  had  been  made  one  of  the 
depositories  of  the  j)ublic  money  of  the  United  States, 
application  was  made  to  the  directors  by  Mr.  F.  O.  J. 
Smith,  of  the  vState  of  Maine,  who  was  then  engaged  in 
starting  the  Westbrook  bank,  for  a  portion  of  the  specie 
of  the  Franklin  bank,  with  the  assurance  that,  as  soon  as 
an  exatninaiion  of  the  specie  in  the  Westbrook  bank  should 


12 


FRANKLIN  BANK. 


Jan 


be  had,  the  quantity  furnished  by  the  Franklin  bank 
should  be  returned.  Specie  to  the  amount  of  ;§f  14,000 
was  furnished  to  Mr.  Smith,  and  after  the  Westbrook 
bank  was  in  operation,  the  specie  was  returned  by  Smith. 
But  the  demands  of  the  Westbrook  bank  upon  the  Frank¬ 
lin,  did  not  stop  with  the  use  of  its  specie.  The  West¬ 
brook  bank  still  needed  the  aid  of  the  Franklin  bank  to 
the  same  amount ;  and  as  the  specie  of  the  latter  had 
been  counted  for  the  benefit  of  the  former.  Smith  still 
desired,  that  the  deficiency,  occasioned  by  the  return  of 
the  specie,  might  be  supplied  by  a  blue  book,  to  be  issued 
by  the  Franklin  bank  for  the  benefit  of  the  Westbrook 
bank.  This  book  was  issued  in  the  name  of  vSmith  bv 
Dunham,  in  direct  violation  of  the  law  of  this  Common¬ 
wealth,  for  the  amount  of  ^14,000,  and  under  circum¬ 
stances  which  it  is  not  necessary  here  to  relate. 

In  furnishing  this  book,  Dunham  and  Hathorne  took 
good  care  to  include  in  it  the  payment  of  their  own  stock, 
to  the  amount  of  ^2000,  in  the  Westbrook  bank.  The 
Franklin  bank  also  furnished  funds  for  the  redemption  of 
the  bills  of  the  Westbrook  bank,  w'hich  swelled  its  in¬ 
debtedness  to  a  much  larger  amount  than  the  ^12,000 
which  were  charged  to  the  Westbrook  bank,  on  account 
of  the  book;  and  in  the  final  adjustment  of  its  balance 
the  Franklin  bank  was  obliged  to  receive,  at  its  own  risk, 
of  the  Westbrook  bank,  the  paper  of  different  individuals, 
^1834  04  of  which  have  not  been  paid. 

These  operations  of  the  bank  in  its  own  stock,  which 
at  last  amounted  to  more  than  half  its  capital,  and  in  the 
numerous  fancy  stocks  of  the  day,  with  extensive  loans 
made  to  its  directors  and  principal  stockholders,  neces¬ 
sarily  involved  its  concerns  in  great  embarrassment. 
These  embarrassments  began  to  be  more  severely  felt  in 
the  autumn  of  1836,  after  Richardson  had  left  the  bank. 


1838. 


13 


.  SENATE— No.  25. 

and  after  ^27,000  of  the  funds  had  been  appropriated  to 
the  purchase  of  Richardson’s  stock.  Although  for  more 
than  one  year  previous  to  this  time  the  circulation  of  the 
bank,  as  it  appears  on  the  books,  in  a  statement  of  its 
condition  made  up  for  Tuesdays  and  Fridays  of  each 
week,  did  not  vary,  upon  an  average,  for  the  whole  of  that 
period,  more  than  two  or  three  thousand  dollars  from  the 
highest  amount  which  the  law  permitted,  yet  this  amount, 
great  as  it  was,  did  not  furnish  the  adequate  means  to 
enable  the  bank  to  meet  its  increasing  liabilities. 

A  new  process  was  to  bo  resorted  to,  and  that  was  the 
issue  of  post  notes.  Up  to  the  period  when  Richardson 
ceased  to  be  president  of  the  bank,  the  issue  of  post  notes 
had  not  exceeded  the  limits  allowed  by  law,  and  in  no 
instance  had  they  been  issued  hut  in  compliance  with  a 
vote  of  the  directors.  But,  as  soon  as  Dunham  became 
president,  it  does  not  appear  that  a  vote  of  the  directors 
was  supposed  to  be  necessary  to  authorize  the  issuing  of 
post  notes. 

On  the  first  Saturday  of  September,  1836,  the  day  on 
which  they  were  required  by  the  governor  to  return  to 
the  office  of  the  secretary  of  the  Commonwealth,  the 
post  notes  then  out,  amounted  to  a  little  over  ^42,000, 
although  the  return  showed  but  ^37,500  the  precise 
amount  allowed  by  law.  On  the  15th  day  of  February 
following,  the  day  upon  which  Hathorne  left  the  bank, 
the  post  notes  amounted  to  ^,222,400.  During  this  same 
period,  the  liabilities  of  the  bank  had  been  still  further  in¬ 
creased  by  the  issuing  of  blue  books,  certificates  of  de- 
posites,  and  the  borrowing  of  large  sums  of  money  upon  a 
pledge  of  its  own  bills,  but  to  w’hat  amount  does  not  ap¬ 
pear  by  any  books  or  papers  examined  by  the  committee, 
3 


FRANKLIN  BANK. 


Jan 


u 

as  these  transactions  do  not  appear  to  have  been  entered 
upon  any  of  the  books  of  the  bank. 

On  the  15th  day  of  February,  1837,  Edmund  F. 
Bunnell  was  made  cashier  of  the  bank  in  the  place  of 
Hathorne,  in  which  situation  he  continued  until  the  fail¬ 
ure  of  the  bank  in  July,  1837.  During  the  administra¬ 
tion  of  Bunnell,  post  notes  were  issued  by  him  to  the 
amount  of  ^241,143,  and  blue  books  and  certificates  of 
deposites  to  the  amount  of  16,548  more,  to  which  is  to 
be  added  a  further  sum  of  $32,200  borrowed  by  the  bank 
on  a  pledge  of  its  own  bills,  and  at  an  interest  of  two  per 
cent,  per  month,  thus  making  the  transactions  of  the  bank 
in  post  notes,  blue  books,  certificates  of  deposites,  and  the 
borrowing  of  money  upon  its  own  bills,  in  a  period  of 
about  ten  months,  amount  to  $612,291,  without  inclu¬ 
ding  the  books  and  certificates  of  deposite  issued,  and  bills 
loaned  by  Hathorne  during  the  last  four  months,  while 
he  was  cashier  of  the  bank.  How  great  a  portion  of 
these  post  notes,  books,  certificates  of  deposite,  and  bills 
were  sold  by  the  bank  on  its  own  account,  to  enable  it  to 
meet  its  immense  liabilities,  cannot  now  be  ascertained, 
as  no  cash  account  was  kept  by  either  Hathorne  or  Bun¬ 
nell  during  the  last  eighteen  months  before  the  failure  of 
the  bank.  But,  from  the  papers  in  the  bank,  showing  the 
settlement  made  with  Bunnell  before  he  left,  it  ap¬ 
peared  that  the  sum  of  $35,927  21  was  allowed  to  him 
on  the  settlement  of  his  account  for  the  shave  to  which 
the  bank  had  been  subjected  on  the  post  notes,  books, 
certificates  of  deposites,  and  bills  sold  on  its  own  account, 
and  that  the  amount  issued  by  Bunnell  and  sold  by  the 
bank  on  its  own  account,  during  a  period  of  about  five 
months,  was  $332,200.  It  was  claimed  by  Hathorne, 
that  the  loss  to  the  bank  on  the  post  notes,  blue  books, 
certificates  of  deposite  issued  by  himself,  and  the  money 


1838. 


SENATE— No.  25. 


15 


borrowed  by  the  bank  on  a  pledge  of  its  own  bills,  was 
greater  than  the  sum  allowed  to  Bunnell,  and  that  a  sim¬ 
ilar  allowance  ought  to  be  made  to  him,  and  be  deduc¬ 
ted  from  the  large  balance  now  standing  against  him 
upon  the  statement  of  the  present  condition  of  the  bank. 
The  whole  amount  claimed  by  Hathorne  to  be  deducted 
from  that  balance,  is  between  seventy  and  eighty  thou¬ 
sand  dollars,  which  sum  is  made  up  of  the  extra  interest 
paid  upon  his  stock  notes  for  a  period  of  about  three 
years,  and  upon  the  post  notes,  blue  books,  and  certifi¬ 
cates  of  deposite,  and  bills  negotiated  by  himself  on  ac¬ 
count  of  the  bank.  The  committee  do  not  pretend  to 
decide  upon  the  correctness  of  this  claim,  but  if  the  rule 
adopted  by  the  directors  in  the  settlement  of  Bunnell’s 
account  be  taken  as  a  criterion,  the  loss  to  the  bank  in 
interest  was  at  the  rate  of  two  per  cent,  per  month. 

The  great  and  unparalleled  amount  of  bills  in  circula¬ 
tion  kept  up  with  most  astonishing  uniformity  for  a 
whole  year  previous  to  July,  1836,  at  the  great  hazard  of 
the  solvency  of  the  bank;  and  the  subsequent  illegal  issue 
of  post  notes,  blue  books,  certificates  of  deposite,  and  the 
loaning  of  its  own  bills,  were  not  the  only  means  re¬ 
sorted  to  bv  the  bank  to  sustain  its  totteriiif^  credit. 

During  the  summer  of  1836,  application  had  been 
made  to  the  secretary  of  the  treasury  of  the  United 
States,  for  a  portion  of  the  government  deposites.  The 
apj)lication  was  not  immediately  acted  upon  by  the  secre¬ 
tary.  The  Lafayette  bank  had  been  incorporated  at  the 
previous  session  of  the  Legislature,  and  in  the  course  of 
the  summer  had  been  organized  by  the  choice  of  its  pres¬ 
ident,  directors,  and  cashier,  and,  on  the  13th  of  July, 
commimced  its  operations.  At  the  commencement  of  the 
operations  of  the  Lafayette  bank,  ;Jf99,300  of  its  stock 
stood  in  the  names  of  Thomas  Richardson,  Josiah  Dun- 


16 


FRANKLIN  BANK. 


Jan 


ham,  Ebenezer  Stevens,  Benjamin  F.  Hathorne,  Isaac  C. 
Barnes,  Josiah  Dunham,  Jr.,  and  Thomas  H.  Dunliam, 
the  four  first  of  whom  were  directors  and  cashier  of  the 
Franklin  bank,  and  of  the  three  last  two  were  the  presi¬ 
dent  and  cashier  of  the  Lafayette  bank,  and  the  other  a 
minor  son  of  Josiah  Dunham,  senior.  Before  the  Lafay¬ 
ette  bank  commenced  operations,  but  after  the  choice  of 
its  officers,  as  testified  by  Hathorne,  and  admitted  to  be 
true  by  some  of  the  directors  of  the  Franklin  bank,  it 
w^as  agreed,  that,  inasmuch  as  the  application  of  the 
Franklin  bank  for  the  government  deposites  remained  un¬ 
decided,  the  Lafayette  bank  should  also  apply  fora  share 
of  the  deposites,  and,  if  they  could  not  be  obtained  by 
both,  that,  as  the  Franklin  bank  had  first  applied,  the 
claims  of  the  Lafayette  bank  should  not  be  pressed  to  the 
prejudice  of  the  prior  applicant,  and  that  if  the  Franklin 
bank  alone  should  receive  the  government  money,  the 
amount  should  lie  shared  between  that  and  the  Lafayette 
bank,  but  in  wdiat  proportions  does  not  fully  appear  by 
the  evidence.  The  Lafayette  bank  immediately  went 
into  operation,  and  the  specie  in  its  vaults  was  counted 
in  conformity  with  the  provisions  of  law. 

The  president  of  the  Lafayette  bank,  and  one  of  its 
directors,  soon  after  started  for  Washington  to  press  the 
application  of  both  banks  for  a  portion  of  the  public  money. 
The  application  of  the  Franklin  bank  alone  was  success¬ 
ful,  and  checks  upon  the  Commonwealth  bank  to  the 
amount  of  100,000  were  forwarded  to  the  Franklin  bank 
from  the  secretary  of  the  treasury.  But  this  addition 
to  the  resources  of  the  bank,  did  not  furnish  it  wdth  much 
substantial  relief  from  its  embarrassments.  For  as  testi¬ 
fied  l)y  Hathorne,  and  not  contradicted  by  any  of  the  di¬ 
rectors,  ^26,000  of  tiiis  money  w^as  applied  to  the  pay¬ 
ment  of  a  debt  then  due  from  the- Franklin  to  the  Com- 


1838. 


SENATE— No.  25. 


17 


monvvealth  bank,  about  ^20,000  more  was  appropriated 
to  procure  an  additional  quantity  of  specie  required  to  be 
kept  in  the  bank  under  the  regulations  of  the  treasury 
department  at  Washington,  and  ^20,000  was  paid  to  the 
Lafayette  bank  under  the  agreement  above  referred  to, 
and  for  the  balance  they  were  obliged  to  wait  the  conve¬ 
nience  of  the  Commonwealth  bank,  before  it  could  be 
paid. 

In  addition  to  the  gross  violations  of  law  by  the  bank, 
to  w  hich  the  committee  have  adverted,  we  also  ascertain¬ 
ed  that  the  rates  of  interest,  demanded  and  received  upon 
discounts  made  at  the  bank,  were  far  greater  than  is  al¬ 
lowed  by  law.  Upon  this  point,  we  will  mention  only 
one  instance,  w'hich  was  a  transaction  in  the  month  of 
December  1836,  to  the  amount  of  ^3,500,  and  upon 
which  the  legal  interest  w^ould  have  been  ^276  08,  while 
the  sum  actually  taken  was  ^1033  54,  making  an  excess 
beyond  the  limits  allowed  by  law,  of  ^757  46.  The 
violation  of  law  by  the  bank,  in  refusing  to  make  to  the 
office  of  the  secretary  of  the  Commonwealth  a  return  of 
its  condition  on  the  first  Saturdav  of  October  last,  as  re- 
quired  by  the  governor,  induced  the  committee  to  exam¬ 
ine  into  the  character  of  its  former  returns. 

The  last  return  of  the  bank,  which  was  made  in  1836, 
of  its  condition  on  the  first  Saturday  of  Se[)iember  in  that 
year,  was  found  to  be  false  in  several  important  particulars. 
The  disclosures  upon  this  point  are  of  so  extraordinary 
a  character,  that  the  committee  feel  bound  not  only  to 
present  a  full  statement  of  these  disclosures,  but  also  of 
the  manner  in  which  they  w^ere  elicited.  At  the  first 
meeting  of  the  committee,  no  testimony  was  received  ex¬ 
cept  Irorn  the  president,  directors,  and  cashier  of  the  bank. 
The  testimony  of  the  president  and  some  of  the  directors, 
attributed  most  of  the  present  embarrassments  of  the  bank 


18 


FRANKLIN  BANK. 


Jan 


to  the  mismanagement  of  Hathorne,  the  former  cashier. 
He  was  charged  with  a  direct  embezzlement  of  the  funds, 
and  that  about  two  montlis  before  he  ceased  to  be  cashier, 
he  was  detected  in  the  transaction  before  referred  to,  in 
which  he  had  appropriated  ^23,000  of  the  money  of  the 
bank  in  a  speculation  in  the  purchase  of  beef  and  pork  with 
another  individual,  and  in  which  Hathorne  was  to  receive  a 
portion  of  the  profits.  It  was  further  testified  by  the  presi¬ 
dent,  and  at  least  two  of  the  directors,  that,  for  three  or  four 
months  before  Hathorne  left  the  bank,  they  had  laicome 
satisfied,  that  no  reliance  could  be  placed  in  his  integrity  ; 
that  the  books  did  not  show  the  actual  condition  of  things  ; 
that  in  many  important  particulars  they  must  have  been 
false  ;  that  there  had  been  an  over-issue  of  bills,  while  the 
books  showed  an  amount  much  less  than  the  law  allowed, 
and  one  of  the  directors  was  stationed  in  the  bank  to  keep' 
guard  of  the  bills  as  they  should  come  in,  and  place  them 
under  lock  and  key,  to  prevent  them  from  being  again 
put  in  circulation  by  the  cashier.  It  was  also  testified  by  , 
the  president,  that  he  now  believes  that  the  return  of  1  836 
was  false,  although  at  the  time  it  was  made,  and  signed, 
and  sworn  to  by  himself,  and  the  other  directors,  he  had 
no  suspicion  that  it  was  not  correct.  The  character  of 
this  testimony,  bearing  so  severely  upon  Hathorne,  induc¬ 
ed  the  committee  to  summon  him  before  them,  and  fur¬ 
nish  him  an  opportunity,  if  he  desired  it,  to  explain  the 
charges  made  against  him.  But  before  the  summons  was 
served  upon  him,  a  request  was  presented  in  his  behalf, 
to  one  of  the  committee,  for  an  opportunity  to  appear  be¬ 
fore  us.  At  the  next  meeting  of  the  committee,  Hathorne 
appeared.  His  testimony,  voluntarily  given,*  embraced 
the  whole  period  of  liis  connection  with  the  bank  as  cash¬ 
ier,  as  well  as  his  agency  in  the  purchase  of  Franklin  bank 


1838. 


SENATE— No.  25. 


19 


stock,  as  detailed  in  a  former  part  of  this  report.  He  tes¬ 
tified  that  the  books  of  the  bank  for  more  than  a  jear  be¬ 
fore  he  left,  did  not  show  its  actual  condition. — that  they 
were  false  in  all  important  particulars, — and  that  the  re¬ 
turn  of  1836  was  false, — that  while  by  the  return  it  ap¬ 
peared  that  the  amount  of  loan  was  ;|^299,284,  the  actual 
loan  was  nearly  ;^370,000, — that  while  the  return  showed 
jgf  134,207  as  the  amount  of  bills  in  circulation,  the  actual 
amount  was  near  ^234,000,  and  that  while  by  the  return 
as  well  as  the  books  of  the  bank,  the  amount  of  post 
notes  out,  w\as  given  at  ^37,500,  the  actual  amount 
was  ^42,000.  Hathorne  further  testified,  that  this 
return  was  designedly  false,  that  it  might  show  a  bet¬ 
ter  condition  of  the  bank  than  was  actually  true — that 
he  swore  to  the  truth  of  this  return,  knowing  it  to  be 
false,  and  that  the  directors  who  signed  and  swore  to  its 
correctness  must  have  known  it  to  be  false — that  he  told 
them  that  there  were  more  bills  in  circulation  than  was 
indicated  by  the  return — and  that,  for  more  than  a  year 
previous  to  this  time,  the  circulation  had  exceeded  the 
limits  allowed  by  law,  and  that  this  fact  must  have  been 
known  to  the  directors,  as  it  was  frequentlj  the  case  that 
there  were  no  bills  in  the  bank,  except  a  few  which  were 
so  much  worn  as  to  be  unfit  for  use.  It  should  here  be 
observed,  that  each  of  the  directors  testified  positively,  that 
they  had  no  knowledge  of  the  falsehood  of  the  return  of 
1836,  at  the  time  it  was  made.  It  should  also  be  ob¬ 
served,  that  the  committee  do  not  consider  any  fact  as 
proved,  unless  it  is  corroborated  by  other  testimony  than 
the  oath  of  Hathorne,  who  now  stands,  by  his  own  volun¬ 
tary  admission,  as  a  witness  who  has  been  guilty  of  wilful 
and  deliberate  perjury.  That  the  return  of  1836  was 
false  is  not  now  conlraverted  by  the  directors,  and  no  at- 


20 


FRANKLIN  BANK. 


Jan 


tempt  was  made  by  them  to  show  that  it  was  correct. 
The  hook  containing  the  statements  of  the  condition  of 
the  bank,  purports  to  show  its  exact  condition  on  Tues¬ 
days  and  Fridays  of  each  week,  and  the  state  of  the  bank 
as  indicated  upon  this  book,  as  was  testified  by  one  or 
more  of  the  directors,  was  read  at  every  meeting  of  the 
directors  for  discounts.  Neither  of  the  returns  of  1836 
or  1835  compares  with  any  statement  upon  this  book  at 
or  near  the  times  at  which  the  returns  were  called  for. 
It  was,  however,  suggested  to  the  committee,  that,  as  the 
condition  of  the  bank  was  called  for  as  it  stood  upon  Sat¬ 
urday,  if  the  return  was  correct,  it  would  necessarily  vary 
from  the  book  containing  the  statements  of  the  bank, 
those  statements  being  made  up  for  Tuesdays  and  Fri¬ 
days,  and  that  the  several  items  in  the  returns  must 
have  been  taken  from  the  entries  of  similar  items  upon 
the  leger.  But,  upon  turning  to  the  leger,  it  was  ascer¬ 
tained  by  the  committee,  that  there  are  no  entries  there 
which  indicate  the  amount  of  bills  in  circulation.  The 
bills  in  circulation  were  always  ascertained  at  any  partic¬ 
ular  time,  by  counting  the  bills  on  hand,  and  dediicting 
them  from  the  whole  amount  which  had  been  filled  up 
and  signed  by  the  president  and  cashier.  The  circula¬ 
tion,  as  entered  upon  the  statement  of  the  condition  of 
the  bank,  as  made  np  for  Tuesdays  and  Fridays  of  each 
week,  must  have  been  ascertained  in  that  manner.  But 
as  the  directors  were  required  in  1835  and  1836  to  make 
return  of  the  condition  of  the  bank  as  it  stood  in  one  case, 
six  weeks,  and  in  the  other  five  months  previous  to  the  time 
when  the  return  was  to  be  made  out,  we  do  not  perceive 
how  it  was  possible  to  ascertain  the  amount  of  bills  in  cir¬ 
culation,  except  by  the  book  containing  the  statements  of 
the  condition  of  the  bank.  But  the  returns  vary  in  all 


1038. 


SENATE— No.  25: 


21 


iniportant  particulars  from  these  statements,  and  particu¬ 
larly  in  the  item  of  hills  in  circulation.  If  it  was  true 
that  at  anv  time  there  were  no  hills  in  the  l)ank  fit  for 
use,  and  that  fact  was  known  to  the  directors,  they 
must  have  known  not  only  that  there  was  an  over-is¬ 
sue  of  bills,  hut  also  that  the  condition  of  the  bank 
W'as  essentially  different  from  any  thing  wdiich  apjieared 
upon  its  hooks.  The  only  item  in  the  return  of  1836,  in 
addition  to  real  estate  and  capital  stock,  which  compares 
exactly  with  the  corresponding  item  upon  the  hook  con¬ 
taining  the  semi-weekly  statements  of  the  condition  of 
the  hank,  is  the  entry  of  ^37,500  of  jiost  notes.  That 
item  is  the  same  upon  the  return  and  in  the  hooks,  but  it 
was  admitted  to  be  false  upon  both.  That  the  hooks  did 
not  show  the  exact  condition  of  the  hank,  from  the  time 
of  making  the  last  return,  in  1836,  until  the  failure  of  the 
bank  in  July,  1837,  and  that  this  fact  became  knowai  to 
the  directors  soon  after  that  return  was  made,  is  admitted. 
The  regular  hooks  of  the  bank  contain  no  entries  of  the 
enormous  amount  of  post  notes,  bank  hooks,  certificates 
of  deposites  beyond  the  amount  of  ^37,500  of  post  notes, 
the  precise  amount  allowed  by  law,  the  remainder  amount¬ 
ing  to  several  hundred  thousand  dollars  being  entered  upon 
a  private  memorandum  book,  which  was  kept  in  the 
drawer  of  the  cashier.  It  w'as  admitted  by  Dunham  and 
Stevens,  that  the  reason  for  not  entering  the  whole  amount 
of  f)ost  notes,  blue  hooks  and  certificates  upon  the  regular 
books  of  the  hank  was  to  conceal  the  illegality  of  these 
transactions.  It  has  been  stated  before,  that  a  great  pro¬ 
portion  of  the  whole  amount  of  post  notes,  hank  books, 
certificates  of  deposites,  were  sold  by  the  hank  on  its  own 
account,  and  the  avails  applied  to  its  own  use  While, 
therefore,  the  avails  of  these  transactions  were  received 

4 


22 


FRANKLIN  BANK. 


Jan 


by  the  bank,  and  applied  to  its  daily  use,  and  at  the 
same  time  these  immense  liabilities  against  it  were  not 
entered  upon  its  regular  books,  it  is  manifest  that  the 
books  of  the  bank,  for  the  last  eight  months  previous  to  its 
failure,  contained  no  correct  account  of  its  most  impor¬ 
tant  transactions.  And  it  is  not  pretended  by  the  direct¬ 
ors,  that  this  state  of  things  was  not  fully  known  to  them¬ 
selves. 

In  addition  to  the  transactions  of  the  bank  which  we 
have  detailed,  we  feel  bound  to  bring  to  the  attention  of  the 
Legislature  another  practice,'which,  if  it  be  not  a  direct  vio¬ 
lation  of  any  particular  law,  is  yet  worthy,  in  the  opinion  of 
the  committee,  of  tlie  attention  of  the  Legislature  ;  we 
allude  to  the  practice  of  loaning  its  specie  to  other  banks 
to  be  counted  as  part  of  their  capital,  at  the  commence¬ 
ment  of  their  operations,  and  then  to  be  immediately  re¬ 
turned.  It  was  admitted  by  Dunham,  that  the  specie  of 
the  Franklin  bank  had  been  counted  as  part  of  the  cap¬ 
ital  stock,  at  the  commencement  of  their  operations,  not 
only  of  the  Westbrook  bank,  as  is  stated  in  a  former  part 
of  this  report,  but  also  of  the  Chelsea,  Lafayette  and  Rox- 
bury  banks. 

In  the  case  of  the  Roxbury  bank,  he  admitted,  that  the 
specie  of  the  Franklin  bank  was  carried  by  himself  to  the 
Roxbury  bank,  and  counted  by  the  commissioners,  in  his 
presence,  as  part  of  the  capital  of  that  bank  ;  and  on  the 
same  evening  was  returned  by  himself  to  the  place  from 
which  it  was  taken. 

The  foregoing  statements  relate  to  the  transactions  of 
the  bank,  before  its  failure  in  July,  1837.  But  the  com¬ 
mittee  also  feel  bound  to  bring  to  the  notice  of  the  Legis¬ 
lature  some  of  its  transactions  since  its  failure. 


1838. 


SENATE— No.  25. 


23 


Upon  the  22d  day  of  September,  1837,  the  following 
vote  of  the  board  of  directors  was  passed  :  — 

“  Voted,  That  the  cashier  be  authorized  to  receive  from 
the  delinquent  debtors  post  notes,  bank  deposites,  or  bills 
of  the  Franklin  bank,  in  the  payment  of  their  notes  and 
checks,  and  that  all  collaterals  be  given  up  to  them,  upon 
the  payment  of  their  respective  notes  and  checks  in  the 
liabilities  of  this  bank  ;  and  that  the  South  Boston  India 
Rubber  Company  have  the  privilege  of  paying  their  debts 
to  this  bank  in  the  same  manner.” 

At  a  meeting  of  stockholders,  held  January  3,  1838, 
the  following  vote  was  passed:  — 

‘‘  Voted,  That  the  directors  are  authorized  and  empow¬ 
ered,  immediately  after  the  passage  of  this  vote,  to  receive 
in  payment  of  all  debts  due  to  the  bank  from  individuals, 
either  as  promisers  or  endorsers,  any  liabilities  of  the 
bank  ;  also  to  receive  from  said  debtors,  when  tendered 
within  fourteen  days  from  this  date,  their  note  or  notes 
payable  in  such  liabilities.  The  amount  or  amounts  of 
indebtedness  to  be  made  up  with  interest  to  date,  and  the 
old  obligations  relinquished  on  settlement  as  above. 

The  stockholders  do  not  seem  to  have  been  unanimous 
in  the  passage  of  this  vote.  It  was  finally  carried,  prin¬ 
cipally  by  the  votes  of  those  who  were  interested  in  its 
passage,  in  consequence  of  their  large  indebtedness  to  the 
bank.  Under  the  vote  of  the  directors,  it  appears,  that 
between  that  time  and  January  12th,  1838,  ^83,058  84 
of  the  debts  of  the  bank  were  paid  in  Franklin  liabilities, 
and  a  large  portion  of  those  debts  from  directors  them¬ 
selves. 

Under  the  vote  of  the  stockholders,  it  appears,  that 
notes  to  the  amount  of  about  ^90,000  have  been  taken, 
payable  in  Franklin  bank  liabilities,  in  exchange  for  the 


24 


FRANKLIN  BANK. 


Jan 


original  notes  held  by  the  bank.  Upon  most  of  the  notes 
thus  exchanged,  some  one  or  more  of  the  directors  were 
liable  as  promisers  or  endorsers,  except  a  large  debt  of 
;^43,000  against  the  South  Boston  India  Rubber  Company. 
And  as  several  of  the  directors  are  members  of  that  com¬ 
pany,  and  as  the  individual  members  of  tliat  corporation 
are  liable  in  their  individual  capacities  for  its  debts,  the 
interest  of  directors  in  having  that  debt  paid  in  Franklin 
bank  liabilities  w’as  equally  as  great  as  if  they  had  been 
promisers  or  endorsers. 

Belbre  closing  this  report,  the  committee  ought  to  ob¬ 
serve,  in  regard  to  Mr.  Josiah  Dunham,  that,  although  he 
has  been  president  of  this  bank  since  August,  1836,  he 
can  neither  read  nor  write,  except  that  he  can  write  his 
name.  This  fact  was  introduced  by  Mr.  Dunham,  as  a 
circumstance  tending  to  show  that  he  could  not  have  had 
any  very  accurate  knowledge  at  the  time  of  many  of  the 
illegal  transactions  of  the  bank,  and  particularly  of  the 
incorrectness  of  the  books. 

The  onlv  comment  which  the  committee  deem  it  ne- 
cessary  to  make  upon  the  facts  disclosed  by  their  investi¬ 
gation,  is,  that  there  is  scarcely  a  provision  of  the  charter 
of  this  bank,  which  has  not  been  deliberately  and  repeat¬ 
edly  violated  ;  and  that,  as  the  corporation  were  duly 
notified  to  appear  before  the  committee,  to  show  cause 
why  their  charter  should  not  be  declared  forfeited,  and  as 
the  corporation  was  heard  thereon,  the  committee  report 
that  the  charter  of  the  Franklin  bank  be  declared  forfeited 
and  void;  and  also  report  the  accompanying  bill. 

The  com^mittee  take  much  pleasure  in  acknowledging 
their  obligations  to  Mr.  Charles  Hickling,  the  present 
cashier  of  the  bank,  for  the  promptness  with  which  he 
furnished  to  them  all  the  information  within  his  know- 


1838. 


SENATE— No.  25. 


25 


ledge,  and  the  aid  which  they  derived  from  him  in  the 
prosecution  of  their  investigations.  Mr.  ilickling  was 
first  employed  by  the  bank  during  the  past  summer,  and 
after  the  failure  of  the  bank,  to  ascertain,  as  far  as  could 
be  done  from  the  books,  the  condition  of  the  bank,  and 
subsequently  was  made  its  cashier.  And  we  would  also 
observe,  that  there  is  nothing  in  any  of  the  transactions 
of  Hickling,  in  connexion  with  the  affidrs  of  the  bank,  in 
the  least  inconsistent  with  the  most  perfect  propriety  of 
conduct. 

Submitted  by  order  of  the  Committee. 


L.  CHILD,  Chairman. 


<£:oiumonti3ealtlj  of 


In  the  Year  One  Thousand  Eight  Hundred  and  Thirty- 

Eight. 


AN  ACT 


To  repeal  the  Charter  of  the  Franklin  Bank. 

Be  it  enacted  by  the  Senate  and  House  of  Represen¬ 
tatives^  in  General  Court  assembled,  and  by  the  authority 
of  the  same,  as  follows: 

1  Sec.  1.  That  an  act,  entitled  “an  act  to  incorpo- 

2  rate  the  President,  Directors  and  Company  of  the 

3  Franklin  Bank,  in  Boston,”  passed  March  the  eighth, 

4  in  the  year  of  our  Lord  one  thousand  eight  hundred 

5  and  twenty-eight :  so  much  of  an  act,  entitled  “  an  act 

6  to  continue  the  banking  corporations  therein  named, 

7  and  for  other  purposes,”  passed  February  the  twenty- 

8  eighth,  in  the  year  of  our  Lord  one  thousand  eight 

9  hundred  and  thirty-one,  as  continued  the  said  corpo- 

10  ration  for  the  purposes  of  banking  :  and  an  act,  enti- 

11  tied  “an  act  to  increase  the  capital  stock  of  the 

12  Franklin  Bank,”  passed  February  the  eighth,  in  the 


28 


12  105379561 


A 

J 


FRANKLIN  BANK.  Jan.  1838. 


13  year  of  our  Lord  one  thousand  eight  hundred  and 

14  thirty-two,  are  hereby  repealed:  provided,  that\ no¬ 
lo  thing  in  this  act  contained  shall  be  so  construed,  as  to 

16  release  or  absolve  the  said  corporation,  or  any  director 

17  or  stockholder  thereof,  from  any  liability  created  by 

18  any  provisions  of  the  acts  hereby  repealed. 

1  Sec.  2.  This  act  shall  take  effect  from  and  after 

2  its  passage. 


